Russian Direct Investment Fund

The Russian Direct Investment Fund (RDIF) is a $10 billion fund established by the Russian government in June 2011 to make equity investments in high-growth sectors of the Russian economy. RDIF's mandate is to co-invest alongside large and sophisticated global investors, thus acting as a catalyst for foreign direct investment in Russia in order to make foreign investors feel more comfortable investing in Russia's uncertain business environment which is rampant with corruption.[1]

History

RDIF was founded in June 2011 under the leadership of both President Dmitry Medvedev and Prime Minister Vladimir Putin as part of a broader initiative to improve the investment climate of Russia and establish Moscow as an international financial center. RDIF is managed by a highly qualified team of private equity investors with broad international and Russian experience.

In its first year of operations, RDIF partnered with China Investment Corporation to create the $2 to $4 billion Russia-China Investment Fund.[2][3] In that period, RDIF also acquired a stake in the power generation company Enel OGK-5, leading an international consortium of private equity investors, including a firm whose investors are Middle East institutions, a private equity fund specializing in the energy sector, and the Macquarie Group's Renaissance Infrastructure Fund and Xenon Capital Partners' Rusenergo Fund.[4] Earlier in 2012 RDIF acquired a stake in the Moscow Exchange Group MICEX-RTS alongside the European Bank for Reconstruction and Development.[5]

At the 2012 St. Petersburg International Economic Forum, President Vladimir Putin announced the formation of an investment consortium between RDIF, BlackRock, Goldman Sachs, and Templeton Asset Management to provide pre-IPO support to Russian companies listing on the Moscow Exchange MICEX-RTS.[6] The consortium will invest a minimum of $100 million in Russian companies that make at least $500 million in annual revenues and are preparing to go public in the next 6 to 18 months.

Corporate structure

Kirill Dmitriev is RDIF's CEO. The Management Company of RDIF is a 100% subsidiary of Vnesheconombank (VEB), Russia's state development bank.

References

  1. ↑ "Russian Direct Investment Fund".
  2. ↑ Spegele, Brian (October 12, 2011). "China to Invest in Russian Fund". Wall Street Journal.
  3. ↑ "Russia-China fund to form, eyes forestry deal". Reuters. 4 June 2012.
  4. ↑ "Middle East money flows into Russian power group". Reuters. 27 April 2012.
  5. ↑ "Bourse deal kicks off Russian push for foreign cash". Reuters. 30 January 2012.
  6. ↑ "Investors to back Russian groups prior to IPOs". Financial Times. 21 June 2012.

External links